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2021 CLEP Official Study Guide

Book $24.99

This study guide provides practice questions for all 34 CLEP exams. The ideal resource for taking more than one exam. Offered only by the College Board.

CLEP® Introductory Business Law Examination Guide

PDF Document $10.00

The Introductory Business Law exam covers contracts, the history and sources of American law, and other topics.

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Introductory Business Law


The Introductory Business Law examination covers material that is usually taught in an introductory one-semester college course in the subject. The examination places not only major emphasis on understanding the functions of contracts in American business law, but it also includes questions on the history and sources of American law, legal systems and procedures, agency and employment, sales, and other topics.

The examination contains approximately 100 questions to be answered in 90 minutes. Some of these are pretest questions that will not be scored. Any time candidates spend on tutorials or providing personal information is in addition to the actual testing time.

Knowledge and Skills Required

Questions on the test require candidates to demonstrate one or more of the following abilities in the approximate proportions indicated.

  • Knowledge of the basic facts and terms (about 30%–35% of the examination)
  • Understanding of concepts and principles (about 30%–35% of the examination)
  • Ability to apply knowledge to specific case problems (about 30% of the examination)

The subject matter of the Introductory Business Law examination is drawn from the following topics. The percentages next to the main topics indicate the approximate percentages of exam questions on those topics.

History and Sources of American Law/Constitutional Law (5%–10%)

American Legal Systems and Procedures (5%–10%)

Contracts (30%–40%)

  • Meanings of terms
  • Formation of contracts
  • Capacity
  • Consideration
  • Joint obligations
  • Contracts for the benefit of third parties
  • Assignment/delegation
  • Statute of frauds
  • Scopes and meanings of contracts
  • Breach of contract and remedies
  • Bar to remedies for breach of contract
  • Discharge of contracts
  • Illegal contracts
  • Other

Legal Environment (20%–25%)

  • Ethics
  • Social responsibility of corporations
  • Government regulation/administrative agencies
  • Antitrust law
  • Employment law
  • Product liability
  • Consumer protection
  • International business law

Torts (10%–15%)

Miscellaneous (5%–10%)

  • Agency, partnerships, and corporations
  • Sales

Study Resources

Most textbooks used in college-level business law courses cover the topics in the outline given earlier, but the approaches to certain topics and the emphases given to them may differ. To prepare for the Introductory Business Law exam, it is advisable to study one or more college textbooks, which can be found for sale online or in most college bookstores. When selecting a textbook, check the table of contents against the knowledge and skills required for this test.


A survey conducted by CLEP found that the following textbooks are among those used by college faculty who teach the equivalent course. You might purchase one or more of these online or at your local college bookstore.

  • August, American Business Law (Pearson)
  • Beatty and Samuelson, Introduction to Business Law (West)
  • Brown, Business Law with UCC Applications (McGraw-Hill)
  • Cheeseman, Business Law (Prentice Hall)
  • Clarkson, West's Business Law (South-Western)
  • Emerson, Business Law (Barron's)
  • Goldman and Sigismond, Business Law: Principles and Practices (Houghton-Mifflin)
  • Jennings, Business: Its Legal, Ethical and Global Environment (West)
  • Kubasek, Dynamic Business Law (McGraw-Hill)
  • Liuzzo and Bonnice, Essentials of Business Law (Richard D. Irwin)
  • Mallor, Business Law (McGraw-Hill)
  • Mann, Smith and Roberson's Business Law (West)
  • Mann and Roberts, Essentials of Business Law and the Legal Environment (West)
  • Miller, Business Law: Text and Exercises (West)
  • Miller, Business Law Today: The Essentials (West)
  • Twomey, Anderson's Business Law and the Legal Environment (West)
  • Twomey and Jennings, Business Law: Principles for Today's Commercial Environment (South-Western)

Online Resources

Score Information

Credit-Granting Score for Introductory Business Law

ACE Recommended Score*: 50
Semester Hours: 3

Each institution reserves the right to set its own credit-granting policy, which may differ from that of ACE. Contact your college as soon as possible to find out the score it requires to grant credit, the number of credit hours granted, and the course(s) that can be bypassed with a satisfactory score.

*The American Council on Education’s College Credit Recommendation Service (ACE CREDIT) has evaluated CLEP processes and procedures for developing, administering, and scoring the exams. The score listed above is equivalent to a grade of C in the corresponding course. The American Council on Education, the major coordinating body for all the nation’s higher education institutions, seeks to provide leadership and a unifying voice on key higher education issues and to influence public policy through advocacy, research, and program initiatives. Visit the ACE CREDIT website for more information.